Would You Pay Half a Million for a Quarter of a Home?

There’s little that we love more than an interesting real estate story, and one’s come up in Toronto that’s raised a very interesting question: should you pay for only a portion of a home?

The home that currently has this opportunity attached to it borders Trinity Bellwoods Park and Queen Street West, and its current owner has owned the home for 35 years. The home is now too large for the retired gentleman, and he’d like to make a profit from it. Problem is, he doesn’t want to leave the property and wants to sell a portion of it. Are you imagining a home with a border of tape running down it to separate the two portions? Well it’s not quite like that.

The home is comprised of four different floors. Larry Chilton, the owner, has put the entire home on the market for $1.7 million, but he prefers to sell only a piece of it. A separate listing has just one floor listed at $479,000; and yet another listing displays 50 per cent of the home up for sale at $960,000. Should one of these portions be sold, Chilton would like to stake claim to the top floor for his own property.

It might sound uncanny and maybe even unheard of, but Chilton explains that it’s not so far off from what people are already doing.

“It’s a home that’s very hard to leave,” he says. “There’s excellent views of park from two sides. It’s like having a forest in front of your house.

“You’re buying an interest share in the property, not unlike two people who know each other coming together a buying a property together. We’re bringing people together and forming an alliance and a partnership.”

Listing agent Daniel Freeman says that while this arrangement might not be the most popular way to buy a home, it’s not one that’s completely unheard of. In Toronto’s Annex location, where homes are beautiful and prices high, Freeman says it’s not at all uncommon for people to come together to buy a home that they’d never be able to afford on their own.

But, local real estate lawyer Mark Weisleder says that just because others might be doing it, doesn’t mean that you necessarily should too.

“Lenders don’t like giving a mortgage over a small piece of a house because if it goes into default, it’s going to be difficult to sell it,” he says.

“That is going to be the main challenge facing a buyer, is raising the money to buy the property.”

And unfortunately, that’s the exact problem buyers will be looking to avoid should they ever consider this type of deal for themselves.